ATC161020: Budgetary Review and Recommendations Report (BRRR) of the Portfolio Committee on Public Service And Administration As Well as Performance Monitoring and Evaluation on Statistics South Africa. dated 20 October 2016

Public Service and Administration

BUDGETARY REVIEW AND RECOMMENDATIONS REPORT (BRRR) OF THE PORTFOLIO COMMITTEE ON PUBLIC SERVICE AND ADMINISTRATION AS WELL AS PERFORMANCE MONITORING AND EVALUATION ON STATISTICS SOUTH AFRICA. DATED 20 OCTOBER 2016

 

1. BACKGROUND

The Portfolio Committee on Public Service as well as Planning, Monitoring and Evaluation (hereinafter referred to as the Portfolio Committee) having considered the directive of the National Assembly, which is in line with Section 5 of the Money Bills Amendment Procedures and Related Matters Act, No. 9 of 2009 to consider and report on the Annual Report of the Statistics South Africa tabled as follows:

 

1. INTRODUCTION

Parliament derives its mandate from the Constitution of the Republic of South Africa. The strategic objectives of the Portfolio Committee are informed by five strategic goals of Parliament. The functions of the Portfolio Committee on Public Service and Administration as well as Monitoring and Evaluation are as follows:

• Participating and providing strategic direction in the development of the legislation and thereafter passing the laws,
• Conducting oversight over the Executive to ensure accountability to Portfolio Committee towards achieving an effective, efficient, developmental and professional public service,
• Conducting public participation and engaging citizens regularly with the aim to strengthen service delivery; oversee and review all matters of public interest relating to the public sector,
• Monitoring the financial and non-financial aspects of departments and its entities and ensuring regular reporting to the Committee, within the scope of accountability and transparency,
• Supporting and ensuring the implementation of the PSC recommendations in the entire public service
• Participating in the international treaties which impact on the work of the Committee.

 

1. PURPOSE OF THE BUDGETARY REVIEW AND RECOMMENDATIONS REPORT

Section 5 of the Money Bills Amendment Procedures and Related Matters Act, No. 9 of 2009 the National Assembly, through its Committees, must annually compile Budgetary Review and Recommendations reports (BRRR) that assesses service delivery and financial performance of departments and may make recommendations on forward use of resources. The BRRR is also a source document for the Committees on Appropriations when considering and making recommendations on the Medium Term.

Moreover the Money Bills Amendment Procedures and Related Matters Act, section 5 (3) highlights focus areas on the budgetary review and recommendation report as:

• Providing an assessment of the department’s service delivery performance given available resources;
• Providing an assessment of the effectiveness and efficiency of the departments use and forward allocation of available resources; and
• Including recommendations on the forward use of resources

 

3.1 Method

The Portfolio Committee on Public Service and Administration as well as Monitoring and Evaluation compiled its BRRR using the following documents:

• The National Development Plan: Vision for 2030.
• Medium Term Strategic Framework 2015-2020.
• State of the Nation Address 2015.
• Strategic Plans of the Statistics South Africa 2015-2020.
• Annual Performance Plans 2015/16 of the Statistics South Africa.
• Annual Report 2015/16 of the Statistics South Africa.
• Auditor-General South Africa’s outcomes of audit findings 2015/16.
• The Portfolio Committee met with the leadership of the Statistics of South Africa

 

1. NATIONAL DEVELOPMENT PLAN VISION 2030

The National Development Plan highlights the need for South Africa to build a state that is capable of playing a developmental and transformative role. This requires the state to formulate and implement policies that support that role. The NDP and the Medium Term Strategic Framework are informed by statistical information provided by Statistics South Africa, which publishes more than 200 statistical releases per year. The publications present statistical research that measures the development and transformation of the economy and society in a range of context.

Changing economic and societal realities have expanded the demand for statistical information: more detailed statistics are needed and more frequently if policies are to be responsive and effective. Statistics in the public domain must be of high quality. Responding to the increased demand for high quality statistics will require a national effort, and collaboration and partnerships between the producers and the users of statistics.

 

1. MANDATE OF THE STATISTICS SOUTH AFRICA

Statistics South Africa is a national government department accountable to the Minister in the Presidency: Planning, Monitoring and Evaluation. The department’s activities are regulated by the Statistics Act (1999), which mandates the department to advance the production, dissemination, use and coordination of official and other statistics to assist organs of state, businesses, other organisations and the public planning, monitoring and decision making. The Act also requires that the department coordinate statistical production among organs of state in line with the purpose of official statistics and statistical principles.

However, there is a legislation reform on the cards for the institution. This legislative reform will inform the full planning cycle of government, from planning to evaluation, including the implementation of the Spatial Data Infrastructure Act. Stats SA has started the legislative review process.

 

 

1. STRATEGIC PRIORITIES

Statistics South Africa aims to contribute towards realisation of the ideals of the National Development Plan (NDP) by providing accurate data policy implementation to overcome social challenges such as inequality, poverty and unemployment. Stats SA work in conjunction with all stakeholders in the country to provide accurate statistical information on economic, demographic, social and environmental factors for proper NDP implementation. The institution has identified the following strategic priorities which are:

1. To promote and inform the nation through an expansion of statistical products and services.
2. To increase statistical trust through sound quality principles that are in line with international standards. This will ensure that users of statistics products have confidence and trust official statistics.
3. To promote partners in statistics, international cooperation and participation in statistics.
4. To invest in the learning and capable organisation.
5. To promote statistical leadership through investment in schools and tertiary programmes to increase statistical skills at grass roots level.

 

1. DEPARTMENT PROGRAMME PERFORMANCE

7.1 Statistics South Africa

7.1.1 Budget Allocated and Expenditure 2015/16

The budget appropriated to the Statistics South Africa for the 2015/16 financial year was R2 323 256 billion. Expenditure was R2 273 540 billion for all the programmes which is an estimated of 97.9%. The bulk of the budget was allocated to the administration programme (R849 840 million), followed by Statistical Collection and Outreach (R575 785 million) and Statistical Support and Informatics programme (R226 418 million).

 

 

 

 

 

Appropriation per programme (R’000)

Programme	2014/15			2015/16
	Final Appropriation (R'000)	Actual Expenditure (R'000)	Expenditure as % of Final Appropriation	Final Appropriation (R'000)	Actual Expenditure (R'000)	Expenditure as % of Final Appropriation
Programme 1:Administration	926 899	840 820	90,7	849 840	800 124	94,1
Programme 2: Economic Statistics	197 460	197 460	100,0	218 651	218 651	100,0
Programme 3: Population and Social Statistics	154 726	154 726	100,0	154 385	161 188	104,4
Programme 4: Methodology, Standards and Research	56 480	56 480	100,0	58 711	58 149	99,0
Programme 5: Statistical Support and Informatics	218 627	218 627	100,0	226 418	220 177	97,2
Programme 6: Statistical Collection and Outreach	530 167	530 167	100,0	575 785	575 785	100,0
Programme 7: Survey Operations	158 158	158 158	100,0	239 466	239 466	100,0
TOTAL	2 242 514	2 156 435	96,2	2 323 256	2 273 540	97,9

 

7.1.2 Budget Allocation

Estimates of National Expenditure for 2016 budget projected Stats SA budget as vote 12. The budget appropriated to the Statistics South Africa in the 2016/17 financial year was R2 489 billion. The 2016/17 reflected a growth in the budget as compared to the allocation of 2015/16 financial year. The spending focus in this financial year will mainly be towards conducting Census and Community Survey Operations. Information will be utilised to enhance planning, policies, monitoring and evaluation in three levels of government. The department intends to employ over 10 450 field workers for the community survey, which will result in 15.7 increase in compensation of employees in 2016/17. Spending on compensation of employees’ accounts for 61.4 per cent of the department’s total budget over the medium term.

Table 1: Budget per programme

Programme R'000	Revised Estimates 2015/16	Medium Term Expenditure Estimates
		2016/17	2017/18	2018/19
1. Administration	795.2	709.2	709.5	731.1
2.Economic Statistics	217.2	224.7	229.2	237.3
3. Population and Social Statistics	154.0	127.0	128.3	132.3
4. Methodology, Standard and Research	57.0	69.6	67.0	67.5
5. Statistical Support and Informatics	231.8	255.4	258.4	267.2
Statistical Collection and Outreach	561.6	569.9	584.3	607.2
Survey Operations	242.2	533.3	191.5	157.7
Total	2 260.1	2 489.1	2 168.3	2 200.4

Estimates of National Expenditure 2016

 

7.1.3 Programme Performance

Statistic South Africa has seven programmes which are as follows:

1.  Programme 1: Administration

The purpose of the programme is to provide strategic leadership management and support services to the department, and capacity building. This programme aims to lead the development and coordination of the statistical production system among organs of state. Secondly, the programme provides direction and leadership through driving strategic and operational planning and monitoring. It also provides corporate support services on an ongoing basis.

 

Administration has spent 94.1 percent of its R849 million final appropriation. This is an increase from the 90.7 percent expenditure rate of 2014/15 financial year. Underspending in this programme amounts to R49 million which is a result of underspending on payments for capital assets, which is related to the building of the Stats SA head offices. This amount is allocated in the office accommodation sub-programme. This amount will be requested to be rolled over to 2016/17.

 

This programme contributes to a number of objectives including driving legislative reform, enhancing corporative governance and investing in statistical leadership and management. The programme had achieved 86 per cent of its targets and was not able to achieve 14 per cent. The 14 per cent not achieved results from the organisation not completing a quality assessment for Domestic tourism. This was due to delays in the signing of a MOU with SA Tourism. This will be finalised in 2016/17. Secondly, the organisation only produced one report instead of two reports on economic and social statistics. Furthermore, two documents had to be developed for the legislative reform planned, however, only one document was prepared. This was due to the delay by consultants in finishing the review of the Statistics Act

The South African National Statistics System coordinates the statistical production system among organs of state. Key output 2015/16 included eight Millennium Development Goals reports, Protocols for the development, compliance and reporting of indicators, a quality statement for the General Household Survey, practice guidelines and protocols for assessment, SASQAF for administrative records, SASQAF Life assessment report for the Crime Statistics of SAPS and a report on consultations with stakeholders on the legislative review of the Statistics Act.

1. Programme 2: Economic Statistics

The Economics Statistics programme aims to produce economic statistics to inform evidence-based economic development and transformation in line with internationally recognised practices. Its main objectives are to expand the economic statistics information base by increasing the depth, breadth and geographic spread for evidence based planning. Programme Management for Economic Statistics provides strategic direction and leadership. 

In this programme, monthly, quarterly, and annual economic statistics are produced. Economic Statistics expenditure was R218 million, 100 per cent of its final appropriation. This programme spent all its allocation even in the previous financial year. For the financial year 2015/16 the programme achieved 98 per cent of its targets, with 2 per cent achieved later than scheduled. The 2 per cent represents 6 targets that were discontinued due to reprioritisation of developing a Growth Accounting Framework (GAF) and the Social Accountability Matrix (SAM). These tools will assist the government in planning, monitoring and evaluating policies.

 

Economic Statistics Programme key output include monthly, quarterly and annual releases in line with the international Special Data Dissemination Standards. This programme informed economic planning, monitoring and decision-making by providing accurate, relevant and timely statistical information on the level of economic activity in relation to the primary, secondary and tertiary sector of the economy, financial information on private sector businesses and government, and information on sustainable resources use and management.   

 

1. Programme 3: Population and Social Statistics

The purpose of the programme is to produce population, demographic, labor market and social statistics to meet user requirements in line with internationally recognised practices. Population and social statistics inform evidence based socio-economic development and transformation in line with internationally recognised practices. Programme 3 contributes to strategic objective in an effort to expand the statistical information base by increasing its depth, breadth and geographic spread.

The population and social statistics produced quarterly and annually should thus be more informative for policy making and decision making purposes. There was over-spending in the Population and Social Statistics programme, which amounted to 4 per cent over the R154 million final appropriation. This is more than the 2014/15 expenditure rate of 100 per cent. The overspending of R6 million occurred in the poverty and inequality statistics sub-programme. This amount was a saving from compensation of employees. This amount was used to fund the Living Conditions Survey that was unfunded and forms part of the mandate of the institution. It forms part of the generation of the Consumer Price Index publication.

 

Overall, this programme achieved 90 per cent of its targets, of which 21 per cent was achieved later than anticipated. The delayed targets result from adopting a new and improved approach in increasing the relevance and accuracy of the statistics, thus resulting in the delayed release of products.

The programme adopted a focused approach to increasing relevance, coherence and comparability of various datasets, which impacted on the timely release of statistics. Challenges include incomplete and late submission of data from other departments and human resource and system constraints. The programme contributed to informing social and economic development planning, monitoring and decision-making by providing relevant, timely and accurate statistical information on living conditions, population dynamics, employment, crime and poverty level and to improving the comparability and accuracy of statistical information by reviewing and evaluating methodological compliance of statistical operations.

In 2015/16, sub-programme provided information on poverty levels and income and expenditure trends in South Africa. The information is critical for the planning of the country and contribute enormously to the work of the Department of Planning, Monitoring and Evaluation. Programme published labour market trends, an annual report on labour market dynamics in South Africa. Regarding the health and vital statistics, programme published statistics on birth, deaths, marriages, divorces, tourism and migration based on administrative records. Furthermore, Stats SA published thematic and research reports and support to the Community Survey and Census.

1. Programme 4: Methodology, Standards and Research

The purpose of the programme is to provide expertise on quality and methodology for official statistics, standards for conducting surveys, and business sampling frames. This will be done by improving the comparability and accuracy of statistical information and by ensuring accurate and reliable statistical information for users. Additionally, this programme conducts policy research and analysis on emerging policy matters. Therefore, this programme provides statistical support and advice to policy makers by annually conducting policy research and analysis.

Methodology, Standards and Research spent 99 per cent of its final appropriation of R58 million. In the previous year, it had spent 100 per cent of its final appropriation. An amount of R562 000 was not spent and this amount emanates from the Methodology and evaluation sub-programme and from the compensation of employees. This was due to vacant posts that were not filled during the financial year. The programme has achieved 82 per cent of its targets and 18 per cent was not achieved. The unachieved 18 per cent of target include the inability of the organisation to produce the two reports on implementing quality management. It is reported that, this was due to the prioritisation of the Community survey. Therefore, these reports will be completed in the 2016/17 financial year.

Amongst key achievement on the programme during the year under review include providing strategic guidance on statistical methodology, monitoring the implementation of the Work Programme and maintaining Business Register for economic statistics.

1. Programme 5: Statistical Support and Informatics

This programme aims to enable service delivery programmes by using technology in the production and use of official statistics. This includes promoting collaboration with potential stakeholders in building and maintaining reliable household surveys. This programme further assists in modernising business processes and supporting the department’s production of official statistics.   Statistical Support and Informatics spent a total of R220million, which is 97.2 per cent of its final appropriation. This indicates that R6million of its allocation was unspent. This was as a result of underspending in the compensation of employees, due to vacant funded posts. This amount was moved to another function to be utilised.

The programme has achieved 51 per cent of its targets, with 46 per cent not achieved. Of the target achieved, 3 per cent were achieved later than scheduled. The 46 per cent not achieved was as a result of the organisation not monitoring the ICT service level standards. An ICT report on the implementation of ICT infrastructure and improving ICT in the provinces was not compiled due to the relocation to new offices and the prioritisation of the Community survey. This report will be done in 2016/17.

The programme contributed to improving the measurement of the economy and society by providing and maintaining a frame for accurate household surveys and a complete and up-to-date database of dwellings for planning and conducting of surveys and censuses. The programme also contributed to providing editing, publishing and distribution services, and a stable and functional network infrastructure and business modernisation in Stats SA.

1. Programme 6: Statistical Collection and Outreach

The purpose of the programme is to provide statistical information to support policymakers. Manage stakeholders to provide effective communication services. Promote statistical development and cooperation in South Africa, Africa and the World.  The programme contributes in enhancing public confidence and trust in statistics; improve productivity and service delivery; lead the development and coordination of statistical production within the SANSS; invest in the learning and growth of the organisation; and promote international cooperation and participants in statistics.

Statistical Collection and Outreach spent all its allocated budget, an amount of R575 million. The programme has achieved 76 per cent of its targets of which 1 per cent was achieved later than planned. 24 per cent of the targets not achieved. The 24 per cent of the targets that were not achieved include a report on new dissemination channels. This report was not produced due to internal stakeholder consultations. Monitoring visitor sessions and document downloaded was also not done due to system constraints.

 

The programme contributed to increasing awareness and marketing, and communicating and disseminating official statistics to relevant stakeholders through effective stakeholder management, internal communications and public and media relations.  The programme contributed to expanding the statistical information database through integrated fieldwork, continuous data collection, stakeholder management, increased collaboration and strengthening partnership within the SANSS, promoting the harmonisation of statistics in Africa, strengthening statistical capacity on the continent, promoting international statistical best practice and building international partnership. 

 

In terms of sub-programme on Provincial and District Office, key achievement include data collection for surveys and collaboration of official statistics to provincial and local stakeholders. Key outputs for 2015/16 included reports on data collection, communication, marketing and publicity activities, maintenance of the provincial spatial information frame, statistical coordination and support, governance and administration and building capacity in the SANSS.

1. Programme 7: Survey Operations

The purpose of the programme is to provide collection and processing support to produce official statistics. Conduct independent household survey monitoring and evaluation activities. The programme contributes in improving productivity and service delivery.

Survey Operations expenditure was at 100 per cent at the end of 2015/16.This indicates that the R 239 million allocated to this programme was spent in its entirety. The programme has achieved 80 per cent of its targets and 20 per cent was not achieved. The 20 per cent target that was not achieved include the technical reports on the Community survey for 2016, amongst others. This will be done in the 2016/17 financial year.

The programme contributed to informing social and economic development, planning, monitoring and decision-making and to increase the efficiency and effectiveness of survey operations. The Census and Community Survey Operations sub-programme conducts periodic population censuses and large-scale population surveys.  In 2015/16 the sub-programme produced a report on coordination and testing of plans and data collection for Census 2016. The sub-programme Households Survey Operations coordinates and integrates collection activities across household survey. The sub-programme produced reports on questionnaires collected, the Living Conditions Survey 2014/15, master sample maintenance and training in survey operations. The sub-programme on Survey Coordination, Monitoring and Evaluation monitors the quality of field operations of household surveys and censuses and conducts independent evaluations.

 

1. AUDITOR-GENERAL OUTCOMES

The Auditor-General (AG) audited the financial statements of the Statistics South Africa in all material respects, the statement of financial position as at 31 March 2016. The financial statements and cash flows for the year are in accordance with Modified Cash Standards prescribed by National Treasury and the requirements of the Public Finance Management Act (PFMA).

 

8.1 Predetermined objectives

The Auditor-General did not identify any material findings on the usefulness and reliability of the reported performance information for the following programmes: Economic Statistics, Statistical Support and Informatics, Statistical Collection and Outreach.

 

8.1.1 Achievement of planned targets

The AG referred to the annual performance report on page 31 for information on the achievement of planned targets for the year under review. The Statistics South Africa received unqualified audit with no findings for the 2015/16 financial year.

 

8.1.2 Adjustment of material misstatements

The AG identified material misstatements in the annual performance report submitted for auditing. These material misstatements were on the reported performance information of Programme 6: Statistical Collection and Outreach. The management of the department subsequently corrected the misstatements. The AG did not identify any material findings on the usefulness and reliability of the reported performance information.

 

8.1.3 Compliance with legislation

The AG performed procedures to obtain evidence that the Stats SA had complied with applicable legislation regarding financial matters, financial management and other related matters. The AG did not identified any instances of material non-compliance with specific matters in key legislation.

 

8.1.4 Internal Control

Internal control in the Stats SA was considered to be relevant to AG audit of the financial statements, annual performance report and compliance legislation. The AG did not identify any significant deficiencies in internal control.

 

1. OBSERVATIONS AND KEY FINDINGS

The Portfolio Committee made the following observations:

9.1       The Portfolio Committee commends the Statistics South Africa for receiving an unqualified audit opinion. However, the Committee urged Stats SA to achieve 100 per cent of its targets. The Committee commended the Stats SA for sterling performance in achieving their set targets and ensuring it remains as conduit of trust for statistical information in South African and globally.

1. The Committee noted a decision by the Stats SA in changing its delivery model and remaining committed in ensuring faster and high-quality statistical data are released timeously. 

 

1. The Committee emphasised the importance of statistic information in ensuring government enhances its planning and policy making by relying on evidence-based results, which are of quality and without any prejudice. Factual evidence assist government and private sector for ensuring sustainable development.

 

1. The Committee noted factual statistical information produced by Stats SA to improve efficiency, effectiveness and good governance in all sectors. Credible statistical information assist in improved planning and better allocation of scarce resources. The Committee urged government departments to often utilise statistical information to improve services delivery.

 

1. Stats SA should utilise media platform optimally to ensure that their statistical information reach out as many people as possible. The use of other forms of social media platforms for dissemination of statistical results is welcome.

 

1. The Committee was concerned about the highest vacancy rate within salary bands 9-12 as compared with other bands in the Stats SA. The Stats SA is required to fill these vacancies speedily.

 

1. The Committee identified an anomaly with regard to permanent employees at levels 6-8 taking sick leave more than other bands. A total of 10 988 days were lost to sick leave at the cost of R11 million. Stats SA management was required to consider reducing the abuse on sick leave which impacted negatively on the performance of the institution.

 

1. Stats SA management should develop a mechanism to curb the abuse of sick leave which impacts negatively on the performance of the institution. The Stats SA should conduct internal rapid analysis on the abuse of the sick leave to understand reasons behind this leave facility. A progress report should be provided to the Committee before end of the financial year. 

 

1. RECOMMENDATIONS

The Portfolio Committee recommends that:

Legislative and policy matters:

1. Statistics South Africa should fast track amending the Statistics Act (1999) to drive statistical reform in order to inform infrastructure planning. The amendments to the Act should firmly respond to the evolving environment and effect alignment with the objectives of the National Development Plan. Statistics SA in concurrence with the Ministry for Planning, Monitoring and Evaluation must ensure amendments to legislation enhance better statistical coordination between organs of state. The amendments should incorporate measures for consequence management to enforce utilisation of statistical information. The Stats SA must provide the Committee with the road map on the amendments of the Act, before end of financial year.

Administrative matters:

1. The Minister for the Department of Planning, Monitoring and Evaluation and the National Treasury should ensure that Statistics South Africa remain the only institution entrusted to produce reliable, relevant and quality statistical information in the country. The Minister of the DPME and the National Treasury are therefore required to communicate with all government departments including Offices of the Premier who are planning to conduct their own independent statistical surveys to collaborate with Statistics South Africa in commissioning such, without any outsourcing. This efforts will minimise duplication, unreliable statistical information and saving of the scarce resources as the Stats SA has the capacity to conduct surveys.

 

1. In light with the Constitutional Court Ruling on the Independent Electoral Commission concerning the residential addresses for voters, the Ministers of the Department of Planning, Monitoring and Evaluation, the Department of Home Affairs and the Department of the Co-operative Governance and Traditional Affairs should ensure that funding is allocated to the Statistics South Africa in carrying out such crucial resolution timeously.

 

1. The National Treasury should assist the Statistics South Africa with funding for planned projects such as Living Survey and Consumer Price Index. Government departments must ensure that transferring of the task to the Statistics South Africa has to be followed by financial resources from their original budget votes. The principle of “budget follows functions” should be adhered to by departments.

 

1. The State Information Technology Agency and the Department of Public Service and Administration must attend as a matter of urgency to ageing ICT infrastructure of the Statistics South Africa.

 

1. CONCLUSION

South Africa currently relies on Statistics SA to measure progress on implementing the National Development Plan and meeting the Sustainable Development Goals (SDG). Therefore, Statistics South Africa plays an important role in South Africa’s drive to development and greater growth rates. This is evident through the organisation continued improvements in the management of the institution and its products. The Governance Cluster of Parliament is complimented for its contribution towards the BRR Report, and also the Support Staff for the drafting of the same.

 

Report to be considered.